Battle Over Oral Drugs Causes Disruption

Meir Rinde
Published: Tuesday, Dec 13, 2016
Bartholomew Clark, RPh, MS, PhD

Bartholomew Clark, RPh, MS, PhD

When a leading pharmacy benefit manager, CVS Caremark, announced in August that it would stop covering prescriptions at physician dispensaries for patients with Medicare Part D drug coverage, it fell to practice staffers like Tommy Harwood to deal with the resulting consternation.

Though CVS backed down, the episode illustrated a pitfall of the new era of oral oncolytics and the related trend of more in-house dispensing. As more oncologists provide pharmacy services, they are encountering competitive pressures from large, powerful drug distribution corporations that are highly focused on maximizing their profit from the lucrative oral oncolytics market, as well as a regulatory environment not designed to enhance the success of small, stand-alone dispensaries.

Contradictory Regulations

Community oncologists’ earnings from infusion and injectable drugs have fallen sharply over the last decade, due largely to the introduction of the average sales price (ASP) metric for Medicare Part B reimbursements. As that change pressures practice finances, and as more oral drugs become available, community oncologists are increasingly establishing their own dispensaries to capture a growing revenue source and maintain close oversight of patients’ treatment regimens. At least a quarter of new cancer drugs under development are oral drugs.
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